Senate Committee to Hear Bill on What the Earth is Worth

Revised farmland assessment program would make it easier for farmers to qualify for tax breaks, harder for politicians and rock stars.

A Senate committee is scheduled to consider a bill changing the state’s farmland assessment program, which is wildly popular with those who qualify and much maligned by many who don’t.

The bill, S-589, would change the income threshold needed to qualify for a lower property assessment in an effort to ensure that only real farmers are receiving the tax break.

The farmland assessment program has made headlines many times over the years for the tax break it has given some wealthy politicians, celebrities, and corporations. Among its beneficiaries: U.S. Rep. Jon Runyan (R-3rd) and former Gov. Christine Todd Whitman; rock stars Jon Bon Jovi, Bruce Springsteen, and Max Weinberg; and Exxon and DuPont.

To qualify to be assessed as farmland and given a lower value, an owner’s land needs to earn $500 from the sale of farm goods, wood, or rent for the use of the land for grazing on five acres of property. That has remained unchanged since the law creating the program was took effect in 1964, although there have been amendments over the years.

The legislation, cosponsored by Senate President Stephen Sweeney (D-Gloucester) and Sen. Jennifer Beck (R-Monmouth) would increase that threshold to $1,000 and require a review of that amount every three years to determine if it should change.

Last year, about 1 million acres of land in the state were classified as farmland, or roughly 18 percent of the state’s total acreage.

The state issues farmland assessment ranges for each county depending on the quality of the soil and what the land is used for. Values range between $22 an acre for woodland to $1,100 for prime cropland.

The lower assessment can translate into a large property tax break. Runyan, for instance, owns 2.8 acres of land with a house and 20.3 acres of farmland in Mount Laurel, according to property records. The farmland is assessed at $2,900 or $143 an acre. The land on which his home sits is assessed at $117,100 or $42,122 an acre. The state’s property database shows that in 2010, Runyan paid $61,426 on his home and its 2.8 acres and $123 on the 20.3 acres of farmland.

The issue of farmland assessment was credited with helping Beck win her Senate seat, since she used against her opponent, the incumbent Sen. Ellen Karcher, the preferential land treatment she received at the time.

The New Jersey Farm Bureau supports some changes to the farmland assessment program, but cautions that legitimate farmers need the break in order to remain viable in this state, which has both high land values and high property taxes. Keeping land green and keeping farmers in business were the goals of the original legislation.

While this bill has been pending in some format for years, it has not moved out of committee. The Senate Energy and Environment Committee is scheduled to hear testimony on it at 10 a.m. in the State House Annex.